J-term 2023: Opportunity to Study Economics of Innovation

This January, Economics and Management Department will offer a one-time special topics course: Economics of Innovation (E/M-244). There are no prerequisites for this course and it counts as an elective for all E/M majors.

Course Description:
Just a couple of centuries ago, most people lived lives that were “solitary, poor, nasty, brutish, and short.” Since then, real incomes have exploded, rising by as much as 3000 percent (from $4 to $120 a day). This class explores the causes of the Great Enrichment, focusing on arguments that attribute this unprecedented raise in living standards to innovation. But what is innovation? What causes it to happen? Is it a product of a great genius or a team effort? Do great advances come from big investments or from gradual trial and error? What role does failure play? To answer these questions, we will study the role institutions play in fostering innovation and the relationship between innovation and entrepreneurship. Students will have the opportunity to explore the spread of innovations by studying the history and influence of key inventions that shaped the modern economy (e.g. paper, insurance, shipping container, video games, infant formula, google search, etc).

Books we will read:

How Innovation Works: And Why It Flourishes in Freedom by Matt Ridley

Leave Me Alone and I’ll Make You Rich: How the Bourgeois Deal Enriched the World by Deirdre Nansen McCloskey and Art Carden

Fifty Inventions That Shaped the Modern Economy by Tim Harford

How Innovation Works: And Why It Flourishes in Freedom by [Matt Ridley] — How Innovation Works: And Why It Flourishes in Freedom by Matt Ridley

A significant part of the class will be devoted to the history of key inventions that made the modern economy (except to work on a group project focused on one of these inventions). To start that part of the course, we will focus on the evolution of phones. We’ll explore what determines that technology becomes widely available and affordable. Take a peek at the two pictures below. The first one is from Downton Abbey, hinting at the fact that in the 1910s only the wealthy had phones. The second picture comes from this 2012 NPR article and was originally titled “A woman talks on her cellphone in a slum area of Bhopal last month.” What happened in the one hundred years between the 1910s and the 2010s that explain this advancement of phones?

Downton Abbey Open Thread: Season 3, Episode 3 | WIRED — Phones in the 1910s

For more on the Hockey Stick of Human Prosperity, check out this video from Marginal Revolution University.

If you have any questions about this course, reach out to the E/M prof. Marta Podemska-Mikluch.